H1 Consular Visa approved but not stamped and OPT expired


I was on F1 and my OPT expired in March 2020/
My H1 visa was approved via consular processing starting Nov, 2018 until Sep 2021.
I had no idea that my visa was via consular processing and never got it stamped. For me, since the H1 was approved was good enough to keep working in my company.
My companies lawyer were preparing for my H1 extension and discovered that my H1 was not activated because I never got it stamped.
They are now asking me to go outside of US and get it stamped ASAP (before September).
They told me that I was not out of status but I was also not authorized to work.
What are my options? I do not want to get banned from entering US especially now I have baby, also my spouse is on H1.

Please expand on the timelines.

When did you start the H1B job?

Where you working with same employer before your H1B job start date? If yes, were you working on OPT?

Yes, I was working with the same employer before H1B start date on OPT.

When did you start the H1B job?

I started job in April 2017 on OPT, the employer filed H1B with consular processing in April 2018. I got the I797 approval notice with consulate as new delhi in Oct with validity period from Nov 2018 to Sept 2021. My final OPT (stem extension) expired in March 2020.